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Cancelled contracts push Synergon into red in Q1

Hungarian IT company Synergon booked a net loss of HUF 347 million in the first quarter on cancelled contracts, the company said in its consolidated IFRS report for the period published Friday.

Synergon had net income of HUF 44 million in Q1 2010. In Q1 2011, it wrote off HUF 226 million from a contract canceled by the Ministry of Rural Development on the gross profit line and it set aside a HUF 110 million provision related to a contract cancelled by the Budapest Fire Department on the operating costs line.

Revenue was up 8% at HUF 4.15 billion. Services accounted for 46% of revenue, down from 60% in the base period.

Cost of materials and services rose 22% to HUF 3.18 billion.

Gross margin fell 21% to HUF 967 million.

Operating costs climbed 13% to HUF 1.29 billion.

Synergon booked a HUF 324 million loss at operating level.

Synergon had total assets of HUF 8.56 billion on March 31, 2011, down 4% from twelve months earlier. Net assets dropped 27% to HUF 3.83 billion.